Macau strains under booming casino economy

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Macau • In a nondescript building around the corner from the world's biggest casino, students at the Macau Polytechnic Institute are in class. Huddled at a long table topped with green felt, they pay close attention as their instructor writes a series of diagrams and numbers on a whiteboard.

But this isn't a regular math lesson. The students sitting around the roulette table are getting schooled on how to quickly calculate payoffs for the casino game by glancing at how the chips are placed. Elsewhere in the room, the biggest mock casino in Asia, other students are playing practice hands of blackjack or learning how to run a craps table.

As many as 8,000 vocational students take courses at the institute's Gaming Teaching and Research Center each year, while a small number of students learn casino skills as part of degree courses. The center's popularity attests to Macau's rapid rise from a seedy backwater to the world's biggest gambling market after the government ended a casino monopoly a decade ago.

Foreign operators such as Las Vegas Sands Corp. and Wynn Resorts Ltd. have invested billions to build glitzy resorts, drawing tens of millions of Chinese gamblers annually that have supercharged the economy. The casino industry's surging growth has created tens thousands of well-paying jobs, raised living standards and boosted the city's economy. The casino boom has been largely peaceful, in contrast to the violence that rocked the city in the 1990s when triads, or Chinese criminal gangs, fought for control of the lucrative VIP rooms.

A wave of new casino megaresorts that are expected to open from mid-2015 will only bolster the former Portuguese colony's standing as the world's top gambling market. But they'll also add to the mixed blessing of a transformation that has produced a lopsided economy and society. Property prices have surged and inequality has widened. Some lament the embrace of materialism and the erosion of traditional community values.

"I have thought of another job, but the salaries at other jobs are lower than the casinos. Now I've become used to this lifestyle," said Marcos Wong, a 27-year-old VIP room supervisor at the Grand Lisboa casino earning 20,000 patacas ($2,500) a month, much higher than the average wage in Macau, a special administrative region of China.

"We didn't have a lot of money when I was growing up so of course I had to study more to try to change my destiny. But to change one's destiny, the reality is you need a lot of money," said Wong, one of the degree students taking the roulette class. He works night shifts while taking courses during the day to upgrade his skills in the hopes of being promoted to a managerial position.

Voracious demand for casino workers has driven Macau's unemployment rate to an ultralow 2 percent. The city's young are in high demand thanks to government restrictions on the number of foreign workers. Casino jobs are popular because the pay is two-thirds higher than the city's median monthly income of 11,700 patacas ($1,465) and many positions don't even require a high school diploma.

But there are drawbacks, including the stress of dealing with customers on losing streaks who become unruly or aggressive.

Student Fion Choi said some gamblers will demand that dealers and supervisors smile and remember their names.

"But then when they lose lots of money they'll say: Why are you smiling?" said Choi, a 29-year-old supervisor at Wynn Macau who hopes to land a mid or senior level management job after she graduates.

Then there's the surreal experience of watching high rollers winning and losing huge amounts of money.

Wong says gamblers, who are almost always mainland Chinese, will bet up to a million patacas ($130,000) on a single hand of baccarat and blow cigarette smoke into his face if they lose.

"We see more and more of these customers," said Wong. "I don't understand how they get their money. They come from a different society where this kind of thinking is normal."

Casino jobs pay 30 percent to 40 percent more than those at other companies, said Choi. That's adding to the strain on small businesses, which struggle to survive because they can't compete with the higher wages.

University graduates, meanwhile, can't find jobs that pay as much as the starting salaries offered by casinos, said Larry So, a political commentator, who worries about the impact all the newfound wealth is having on the city's young.

"The young people nowadays, one of their favorite jobs is to go into a casino, or the government," said So, lamenting the changes that the casino industry has wrought on Macau.

"In the past casino workers were secluded, a small part of the population. In Chinese culture we did not look up to these kind of people." Now they've become such a big and wealthy group, they are the ones that set the values, So said.

The number of people working in gambling and related industries has doubled over the past seven years to nearly 90,000, or about a quarter of the workforce. About 23,000 are dealers.

So said that because of casino workers' influence on society, Macau people are more materialistic and care more for fast cash than careers. It's also caused a rise in problem gambling, "because the dealers they think they know how to gamble, and they start to gamble and of course they lose," So said.

Macau's casino boom has also had other side effects. It has reshaped the landscape of the 28-square-kilometer (11-square-mile) city. Flashy, oversized resorts built in the Cotai district, including Sands Corp.'s Venetian Macao, the world's biggest casino, have added a brash and jarring contrast to the city's European-style architecture. Created by filling in the sea between Coloane and Taipa islands, Cotai will be the site of the next wave of expansion by Sands and Macau's five other licensed casino operators.

Public discontent is rising over a sharply widening wealth gap and surging property prices. The government, which earns more than 70 percent of its tax revenue from casinos, has tried to pacify the public by giving annual cash handouts to each resident. Chief Executive Fernando Chui, the city's leader, last week said the amount would rise to 8,000 patacas next year.

Chui also announced plans to provide more housing for residents and offer interest free loans to young entrepreneurs.

But some are skeptical such measures will make any difference.

"Macau is a complete illusion of prosperity because what we are building is only casinos, rooms and some shops with famous brands," said lawmaker Jose Coutinho.

Coutinho said he worried that Macau's university graduates would find it increasingly hard to find jobs not related to the gambling sector and that workers would be vulnerable in a downturn.

"If they are in middle age and they lose their jobs, it's very difficult for them to find another job in Macau," he said. "You need to be very careful on this in the future."

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